How to Buy Real Estate Notes, A Personal Experience

Look at this – A note broker friend and I had a conversation about a 23-note pool made up of 1st and 2nd mortgages, all nonperforming loans. It was a $3 million dollar pool.

And after reviewing of the loan papers I placed a $1.1 million offer to buy the real estate notes. The very next day my bid was accepted.

Hang on, hang on before you think “good for you, Dean, but I only have $20,000 to spend so this isn’t for me…”

My original bid was for 6 non-performing notes in this pool. And the seller told me I was on the short list based on my bid on those 6.

Could you have bid 2 of those real estate notes for say $50,000 a piece? Sure.

My Tip On Real Estate Note Buying

Just make an offer. In most cases, you will not be informed ahead of time if they will allow you to pick a few loans out of the pool.

And, back tot he story…

Then, a day later – I get a call from the bank selling me the real estate note pool asking me if I’d be interested in an $8 million pool of non-performing notes that they’re sending out in another month, out of which I can probably “cherry pick” the notes I want.

Do you see why I enjoy note buying?

Instead of having to run after all your real estate note investment deals, (buying/finding properties) you can build one relationship that keeps generating more business.

A Point on How to Find Real Estate Notes

When your closing deals in the note buying business, be dependable. Close when you say you will and pay the price that you bid…a lot of investors will think about you when they have a future note buying deal. Track records count.

That’s an efficient way to build your pipeline of note buying deals – and that’s what makes the non performing note business so attractive – for this fraction of Real Estate Investors out there who understand how to buy real estate notes.